Commercial Real Estate Job Opportunities Back to 2007 Levels
Development and Single-Family Housing Jobs lead surging Job Market
Commercial real estate job opportunities numbered 2% more than available in mid-2007 and represented the second highest single-month total since the Cornell/SelectLeaders Job Barometer began in October 2006. The first quarter of 2014 marked the thirteenth straight quarter in which there was positive growth in CRE job postings when compared with the same quarter the prior year. “All indicators point to considerable strength in real estate job opportunities,” said David Funk, director of the Baker Program in Real Estate at Cornell University, adding “with this momentum we should expect to see compensation start to return as well.” Job opportunities were up 25% over the first quarter of 2013, and the second quarter appears poised to continue the trend with April and May up 18% and 33%, respectively, over the same months last year. The Job Barometer surveys the leading sources of commercial real estate jobs monthly and represents the leading job market index in the industry. “Admittedly some of this was catch-up ball, because our industry was hit so hard, employers were cautious about hiring until they absolutely had to,” added Susan Phillips-LoPinto, CEO of SelectLeaders Job Network. “Entering June, the Job Barometer recorded job posting levels that we have not seen since 2007.”
The Cornell/SelectLeaders Job Barometer also found that since the Global Financial Crisis employers appear to be searching for more well-rounded applicants who have a diverse skill set and can fill many roles. “Employers have not settled back into their pre-2008 traditional job functions with many job duties remaining fluid,” said Ana Mossa, Research Director for SeclectLeaders, adding that the result is expanded roles for new hires.
Employment Picture by Industry Sector: Single Family Housing Posts Significant Growth
The single-family housing sector, which traditionally has been slow to command a significant portion of job postings, experienced the most significant increase in job postings between January and May. Since 2008, single family housing has typically accounted for less than 10% of job postings, and yet represented 14.4% of all CRE job opportunities in May, which is up 113% from a year ago. “A combination of the housing industry ramping up as well as the single-family rental business maturing and now generating jobs is behind this jump,” said Funk. As single-family hiring heats up, multi-family opportunities are in slight decline. Multi-family housing positions, which led the recovery by consistently being at the top of job opportunities have finally declined slightly through the first half of 2014, from 13.1% in the fourth quarter of 2013 to 10.7% so far into the second quarter of this year. It is too soon to tell whether the single-family growth is indicative of a long-term trend, but the multi-family sector appears poised to decline for the fifth quarter of six since hitting a mark of 16.3% in the fourth quarter of 2012. Meanwhile, retail remained the strongest sector, accounting for 15.7% of job postings. Though it has fallen from 19.8% in January and 27.1% last May, it has remained above its long-term monthly average of 9.0% since February 2008. The sectors that led the recovery are settling into normal growth, while development and single family, which were among the last to recover, are now leading job growth.
Employment Picture by Business Field: Growth in Property Management Firm Openings
Investments (asset management) is the most prevalent field of opportunity in CRE, accounting for 19.2% of all postings in the second quarter to date and narrowly above its long-term quarterly average of 18.1%. Development and Property Management both represent 15% of all postings, while Advisory Services/Consulting comes in fourth with 11.8%. The Investment (asset management) field has shown a decline from a peak of 35.4% in the first quarter of 2011.
Finance firms are also representing a less significant portion of the real estate hiring picture as they accounted for just 7.7% of job opportunities in the second quarter, down dramatically from their historical average of 14.5% of all job openings, and the lowest percentage since 2008. “The slowdown in refinancing activity combined with an overall decline in transactions has made real estate finance opportunities comparatively scarce,” said Funk.
Conversely, property management hit its highest mark since the third quarter of 2010, with 20.7% of all jobs posted during the first quarter; higher than it was during any quarter in 2012 or 2013. Corporate real estate positions rose from 3.9% in the second quarter of 2013 to 9.4% in the second quarter to date of this year. That is the highest mark since the fourth quarter of 2010 for a field that typically only represents 5.0% of postings.
“Job Specifications for Property Managers are broadening,” added Phillips-LoPinto. “Today employers may request accounting skills, and many include leasing experience as a plus. No wonder Property Manager jobs are increasing – “they are absorbing what previously were other job functions.”
Employment Picture by Job Function: Development Continues Upward Trend
What are currently the hottest individual jobs in CRE? While property managers continue to represent the most prevalent job function, development project managers are closing this gap. These jobs hit their highest point on record with the Job Barometer at 13.0% in the first quarter, only to top that mark to this point in the second quarter at 13.7%. Accounting candidates are still in demand, as 11.6% of all postings are for these positions, yet they are representing a smaller share of postings than in recent years, as indicated by the fact that the category has not surpassed its long-term average of 15.6% since the second quarter of 2010. Financial analyst positions spent ten consecutive quarters above their long-term average of 6.3%, culminating in a mark of 10.2% in the first quarter of this year. Through April and May, however, financial analyst positions have represented only 5.9% of jobs analyzed. It remains to be seen whether this large drop between the first and second quarter is an anomaly or part of a more protracted trend.
Meanwhile, property manager positions have been relatively stable, and are currently at 15.0%, compared with a 15.3% long-term quarterly average. The remaining postings show a remarkable diversity of opportunities, as 25 job functions represented less than 5% of all jobs analyzed for the Job Barometer.
Cornell/SelectLeaders Job Barometer
The Cornell/SelectLeaders Job Barometer is a collaborative research partnership between the Baker Program in Real Estate at Cornell University and the SelectLeaders Real Estate Job Network. Since 2007 Graduate students and faculty in the Baker Program survey the leading sources of commercial real estate job opportunities on a monthly basis and produce the leading index of job trends in the industry along with the annual CRE Employment Matrix and the Cornell 30 large employer monitor.
Baker Program in Real Estate
The Baker Program in Real Estate at Cornell University offers a comprehensive, professional graduate level curriculum that educates the next generation of real estate industry leaders taught by the largest on-campus real estate field faculty in the country. Cornell is also home to the Cornell Real Estate Council, an extensive network of industry leaders, the Cornell Real Estate Review, conferences, research and industry news, and more. Further information regarding the Cornell Program in Real Estate can be found at baker.realestate.cornell.edu. Visit often to discover real estate at Cornell.